Federal Prosecutions Serve as Reminder to Comply with Tax Obligations as Filing Deadline Approaches
CHICAGO — Federal authorities today announced criminal charges against four Chicago-area residents for a variety of alleged income tax frauds. With tax season in full swing, the prosecutions serve as a warning to avoid dishonest tax-return preparers, and to remind taxpayers that each individual is responsible for the contents of his or her own return.
Two Chicago-area tax preparers were charged with assisting clients in obtaining hundreds of thousands of dollars in fraudulent refunds. The preparers fraudulently reduced their clients’ tax liabilities by misrepresenting their eligibility to claim tax credits, such as dependent exemptions, education and child credits.
In addition, two individuals were indicted for filing hundreds of fraudulent income tax returns that claimed refunds totaling more than $2.1 million. The fraudulent returns were filed electronically with the Internal Revenue Service.
“Tax preparers and individuals who willfully file false returns will be held accountable,” said Zachary T. Fardon, United States Attorney for the Northern District of Illinois. “Although tax prosecutions occur throughout the year, it is especially important with Tax Day looming to remind the public of the importance of proper compliance with their tax obligations.”
“IRS Criminal Investigation is committed to ensuring that honest taxpayers are not cheated and that all taxpayers pay their fair share,” said James D. Robnett, Special Agent-in-Charge of the IRS Criminal Investigation Division in Chicago. “With the filing deadline approaching, individuals who might be thinking about cheating should think twice or they will risk the consequences.”
According to statistics available from the Treasury Inspector General for Tax Administration, U.S. taxpayers filed approximately 150 million returns in 2014. The IRS found that more than 2.1 million of those returns claimed fraudulent refunds totaling more than $15.7 billion.
In addition to criminal penalties, including incarceration, fines and the costs of prosecution, convicted defendants remain responsible for all taxes and interest due, as well as civil penalties, U.S. Attorney Fardon noted. Individuals making false claims against the government may be required to pay restitution and could be sued civilly for an amount greater than the fraudulent claims, he added.
In one of the prosecutions announced today, TAMITHA BROWN, 50, of Bolingbrook, was charged with preparing and filing false and fraudulent income tax returns. Brown, a tax preparer who owned Bolingbrook-based E&T Tax Services Inc., filed the returns for the years 2008 through 2012, resulting in tax losses of approximately $189,856, according to the indictment. The government in Brown’s case is represented by Assistant U.S. Attorneys Jeannice Appenteng and Cornelius Vandenberg.
Another tax preparer, BARBARA GARRETT, who co-owned Chicago-based Preferred Financial, was charged with filing seven individual income tax returns that she knew contained false and fraudulent information. Garrett, 45, of Chicago, filed the returns on behalf of various taxpayers for the tax year 2009. The false information included invalid business losses and education credits, according to the indictment. The government in Garrett’s case is represented by Assistant U.S. Attorney Sean Driscoll.
Two individuals, TANYEA MACK and KATRINA WALLS, were charged with filing hundreds of fraudulent individual income tax returns. Mack, 40, of Waukegan, filed approximately 232 false returns in the names of various individuals, claiming refunds totaling more than $1.15 million, according to the indictment. Walls, 41, of Chicago, filed approximately 177 false returns in the names of various individuals, claiming refunds totaling $983,798, according to the indictment. Assistant U.S. Attorney Derek Owens represents the government in the Mack and Walls cases.
The public is reminded that an indictment is not evidence of guilt. The defendants are presumed innocent and are entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt. If convicted, the Court must impose a reasonable sentence under federal statutes and the advisory U.S. Sentencing Guidelines.
For tips and guidelines to assist taxpayers in choosing a reputable tax professional and for preparing their own taxes, visit the official IRS website by logging on to: https://www.irs.gov/uac/Choose-Your-Tax-Preparer-Wisely.